1. Technical Field
The present invention relates generally to the syndication and management of syndicated loan facility. More particularly, the invention relates to an online display auction method whereby users of online systems, namely, lenders, banks and loan originators, may negotiate loan rates, loan parcels, conditions and accompany terms with each other in an online, anonymous manner. In addition, the invention relates to an online method where loan syndicates and originators may post loan rate and information for loan syndication to allow lenders the opportunity to evaluate competitive prices, preferably in one consolidated location (e.g., a web site) in order to get the maximum return.
In also provide for potential lenders to post their requirements to participate in any loan syndication and to allow syndicates the opportunity to evaluate the different resources available in order to get the least borrowing cost for their client. The invention further relates to managing and monitoring of loan syndicates on-line once the loan syndication is completed.
2. Description of the Related Art
The World Wide Web is the Internet's communication medium and information retrieval system. In the web environment, client machines effect transactions to web servers using the Hypertext Transfer Protocol (HTTP), which is a known application protocol providing users access to files (e.g., text, graphics, images, sound, video, etc.) using a standard page description language known as Hypertext Markup Language (HTML). HTML provides basic document formatting and allows the developer to specify “links” to other servers and files. In practice, the web is a vast collection of interconnected documents link together by hyperlinks, spanning the world. The advantage of hypertext is that in a hypertext document, if you want more information about a particular subject mentioned, you can usually “just click on it” to read further detail. In fact, documents can be and often are linked to other documents by completely different authors. In the Internet paradigm, a network path to a server is identified by a so-called Uniform Resource Locator (URL) having a special syntax for defining a network connection. Use of an HTML-compatible browser (e.g., Netscape Navigator or Microsoft Internet Explorer) at a client machine involves specification of a link via the URL. The browsers can, in addition, access files by FTP, NNTP (the Internet news protocol), gopher and an ever-increasing range of other methods. On top of these, if the server has search capabilities, the browsers will permit searches of documents and databases. One of the technical advantages of the World Wide Web is the ease with which information may be posted and retrieved by users who have on-line access. In the banking industry the way that loan syndication is arranged is that information are faxed to potential lenders usually other banks. The originator ie the managing bank will then collect this information and feedback to enable it to conclude an opinion regarding the prospect of the loan and report back to the client. This method is called “sounding” and the advantage is to be able to price a loan correctly. There are many banking sites now which deals directly with consumers but not one for bank to bank business. Loan syndication is a specialise business and therefore the information are not easily obtained directly. There are currently publications like FIR or Basispoints which deals with past and reported on loan syndication done. These publications are not for banks to contact other banks to strike a deal.
It would be highly desirable to provide an online business method wherein banks or financial institutions can obtain syndication commitments anonymously from one or more loan originators, and negotiate terms and pricing with them. From the originators' point of view it is an advantage to be able to reach out to the whole community directly through this website giving them a quicker turnaround time. Lenders will also be able to look at competing syndications to discover better terms at the same website. Given the nature of the auction process, the ultimate benefactor will be the final borrower which will see reduced borrowing costs by reaching to wider audience. In the same way, the automation of the administration process of loan syndication is included hence reducing the cost of overall service cost. The present invention solves all these issues.